The decision last week by two U.S. government agencies to open a new trade investigation related to Chinese solar products is good news for SolarWorld, the struggling German company with its U.S. headquarters in Hillsboro. But the stakes in this bit of trade politics are much higher than the 600 or so Oregon jobs made possible by SolarWorld.

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SolarWorld Industries America Inc. won duties starting in 2012 on Chinese solar products imported into the United States. But, The Oregonian’s Richard Read reported, Chinese companies have avoided tariffs by exporting panels using solar cells made in other countries, mainly Taiwan, which weren’t covered by the original ruling.

The International Trade Commission and U.S. Commerce Department now are investigating the products coming from Taiwan. The ITC plans to make a preliminary ruling by Feb. 14 on whether there’s reason to believe imports from China or Taiwan are damaging the U.S. solar industry. If the commission reaches that decision, the Commerce Department then would issue rulings on the allegations of improper subsidies and product dumping. Those rulings could lead to new tariffs and duties.

Predictably, China took offense at the latest investigations. “China will closely follow the case, assess the impact on the Chinese solar sector and resolutely safeguard our interests through various mechanisms,” China’s Ministry of Commerce said in a statement issued in response to the investigation.

The implications for SolarWorld, which has led the U.S. solar industry’s push for duties on Chinese products, are obvious. The company, in the midst of consolidating its U.S. operations in Hillsboro, continues to bleed money — though the losses are declining. Through the first three quarters of 2013 SolarWorld lost 135 million euros, compared with 230 million euros in the first nine months of 2012. The improvement, in part, reflects reduced expenses due to layoffs and other restructuring.

More importantly, the solar dumping investigations also carry broader implications for trade and environmental policy. As China has emerged as a global economic power, the United States and other countries have struggled to establish an economic relationship based on acceptance of international trade guidelines. Meanwhile, environmentalists and companies involved in solar installation worry that if duties led to higher prices, demand for solar panels in the United States would fall.

Declining economic conditions in China further complicate matters. Economic growth has slowed to the lowest levels in two decades as global demand for Chinese products has declined and Chinese consumers struggle with high housing and health care costs. Chinese officials simultaneously find it more difficult to subsidize the solar industry as debt mounts and more important to maintain Chinese companies’ market share as the economy slows.

So what’s the best approach for the U.S., and what does it mean for SolarWorld and the company’s Hillsboro workers?

Long-term, the most important thing at stake is the principle of fair trade. As China assimilates itself into the modern global economy, trade partners must insist that it play by the rules. If enforcing those rules increases the price of solar products, that’s OK. It’s important that the U.S. continue to increase the use of green energy, but for solar and wind energy to succeed, consumers need to accept those products at market price. If China obeys international rules and consumers pay market prices, SolarWorld has a chance – provided its products and operational efficiencies are equal to or better than competitors’.

All things considered, the latest investigations are encouraging for SolarWorld and Oregon. But it likely will take a while before we know whether the sun sets or rises on solar manufacturing in the United States.